Frasers Centrepoint Trust struggles with weak occupancy at Bedok Point

Saving grace was an 8.7ppt jump at Causeway Point.

According to OCBC, Frasers Centrepoint Trust (FCT) reported 1QFY13 NPI of S$27.1m and distributable income of S$21.8m, up 9.1% and 10.8% YoY respectively.

Of the available distributable income, we note that S$2.1m will be retained this quarter, as opposed to S$1.6m in 1QFY12. As such, DPU for the quarter came in at 2.40 S cents, representing a YoY growth of 9.1%.

This is largely in line with expectations, given that the quarterly DPU met 22% of both the firm's and consensus FY13F DPU estimates.

Here's more from OCBC:

Operating indicators largely positive All the five malls within FCT’s portfolio registered healthy growth in income during the quarter. However, Causeway Point (CWP) and Northpoint remained the key drivers, generating 12.3% and 6.7% YoY increase in NPI.

Operationally, we note the overall portfolio occupancy improved from 93.6% in prior quarter to 97.2%. This was boosted by an 8.7ppt QoQ improvement in occupancy at CWP to 96.4% following the completion of its AEI, which cushioned the temporary weakness at Bedok Point amid a reconfiguration of its layout.

Overall, a total of 62,341 sqft of NLA (7.1% of portfolio NLA) was renewed at an average positive rental reversion of 5.2% in 1Q (4QFY12: 8.9%).

Management also revealed that several new tenants are still in the process of fitting out at CWP and expects the occupancy to trend up further when more tenants commence their operations from Jan onwards.

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